The "talk the economy up" thread.

treliac

chrisandanne wrote: »

That's revolting.....are those attachments for real :eek: A x

:rotfl: :rotfl: :rotfl: :rotfl: :rotfl:

Now I'll never sleep tonight

wymondham

BBC just announcing mortgage approvals for September up slightly... no link yet....

posh*spice

Tax cuts for all:j:j:j - no link yet;)

Conrad

The bottom is close and the smell is allright

Generali

Conrad wrote: »

The bottom is close and the smell is allright

What makes you think we're close to a bottom please? Do you mean for house prices or for the economy in general?

Conrad

Generali wrote: »

What makes you think we're close to a bottom please? Do you mean for house prices or for the economy in general?

Pound is so low that UK business will benefit. Our knowledged based outputs can react quickly and are scaleable. Export demand will rise as a reult of the cheaper pound. In the 1929 depression we escaped relatively lightly compared to other nations as a result of leaving the gold standard in 1931 which devalued the pound.

Interest rates are set to fall dramatically, thus pushing up property investor yields and providing impetus for people to buy rather than rent.

On the downside rising unemployment is a worry, but not so much so here between Stansted and the Olympics. Stansted is expanding 10% (23400 flights pa) and the Olympics build will fuel the local economy come what may.

Frozen lending will thaw gradually next year, as I witnessed in 1991 when Nationwide introduced the negative equity package and Nat West & Abbey reintroduced 100% loans.

I am a pessimists, really I am, but I fight the easy impulse to think the sky is falling in.

tomstickland

Demand for new cars is surging says local garage (no link yet). Hurry whilst stocks last!

DirectDebacle

Conrad wrote: »

Pound is so low that UK business will benefit. Our knowledged based outputs can react quickly and are scaleable. Export demand will rise as a reult of the cheaper pound. In the 1929 depression we escaped relatively lightly compared to other nations as a result of leaving the gold standard in 1931 which devalued the pound.

Interest rates are set to fall dramatically, thus pushing up property investor yields and providing impetus for people to buy rather than rent.

I am a pessimists, really I am, but I fight the easy impulse to think the sky is falling in.

Wishful thinking.

Optimism or pessimism is not required. Realism is. Below are the last ten years of our balance of payments. Figures are in £millions and all in defecit. Full breakdown is available here: http://www.statistics.gov.uk/statbase/tsdataset.asp?vlnk=224&More=Y

1997 -12342
1998 -21813
1999 -29051
2000 -32976
2001 -41212
2002 -47705
2003 -48607
2004 -60900
2005 -68589
2006 -76312

Interest rates are historically low and a further reduction will do little to stimulate demand in the housing market. Affordability (house prices continuing to fall), banks starting to lend again and job security will stimulate demand in that sector of the economy. To compare the causes of the last recession and house price deflation to this current one is fallacious.

Then the causes were much more home-grown (remember Black Wednesday, double digit interest rates?) and were less influenced by global markets. That made it more in our control to put it right. This is different, we are at the mercy of world markets in addition to the underlying weakness of our own economy. A low pound isn't going to help our balance of payments as we are a net importer. See above figures.


Fact of the matter this recession, like any other, is going to hurt. People are going to lose their jobs, their homes and savings. Businesses are going to go under. It is already happening and will continue. I believe around this time 2010 we may start to see an improvement.

The sky isn't falling in and it isn't the end of the world, but there are tough times ahead. Bear in mind we have had continuous growth for around the last 15 years. That means for most people below the age of 40 this is the first recession of their working life. Add to this the huge amount of personal debt that they have accumulated (which wasn't the case in 1991) and the mood of the country is understandably going to be very gloomy. Welcome to the real world. Ten - fifteen years from now people will look back at this decade and recognise it as a period of madness, hopefully never to be repeated. Maybe they will have taught their children that a credit card is really a debt card and that a house is home (for 20yrs or so) and not a 6-12 month quick profit investment punt.

Ah well, soon be Christmas.

DirectDebacle

Just noticed BIG error in my last post. Conrad is spot on.

You see balance of payments defecit rises pretty much in line with house price inflation. So stands to reason that as house prices fall so will our countries debt. I reckon that by tomorrow lunchtime our 80bn defecit will be about a 15bn surplus and rising. So next week Govt. will have loads of spare cash sloshing about and as Govt money is really our money we're all gonna be rich.

I want Conrad to sell me a hugely expensive mortgage so I can get a big house near Stansted airport. This is essential because after my spending spree at Tesco's later today I hope to have enough clubcard points to buy a Lear jet, and parking is a problem in my cul-de-sac.

Recession? What recession, we've never had it so good and I am pleased G. Brown ended boom and bust.

sabretoothtigger

The most optimistic thing that can be said is when all the bankers stop thinking their great, realise they screwed up and the outlook is not good then they are being their most realistic and recovery becomes most viable.

We were in far more trouble thinking everything was fine when it wasnt and continuing to dig deeper debts, ie. rbs buying a bank last year instead of allocating the money to bad debts